Return on Winners

Return on Winners

Definition
The total profit generated by your winning trades over a specified period.

Formula
Return on Winners = Sum of (Profits on Winning Trades)

Example
Imagine you have the following trade history for a month:

  • Trade 1: Profit of $350
  • Trade 2: Loss of $100
  • Trade 3: Profit of $150
  • Trade 4: Profit of $80
  • Trade 5: Loss of $50

Your Return on Winners would be: $350 + $150 + $80 = $580

Key Points

  • Winning Strategy Assessment: Helps evaluate how effectively your strategy generates profits when it results in successful trades.

Considerations

  • Doesn’t Account for Losses: It’s important to consider this stat alongside “Return on Losers” to get a complete picture of your trading performance.

 

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